Improving Banking Supervisory Mechanisms
In the OIC Member Countries
89
APPENDIX: Banking Sector In Selected OIC Countries
In this section, we focus on selected member countries and evaluate developments in their
banking in various dimensions. Particularly, we look at some performance and risk measures
of the banking sector in the OIC member countries. We will
o Malaysia
Banking Sector
In this section, we evaluate the current stance of the banking sector in Malaysia. For the
analysis, we compiled a dataset covering all banks operating in Malaysia using the Bankscope
database.
Loan portfolio of Malaysian banking system is larger than the average of the selected OIC
member states. This implies the real sector activity and the banking sector is closely
interrelated. As a result of this, credit risk of Malaysian banking system is 90% of its total
banking risks. Malaysian banking system has a moderate securities portfolio which consists
24% of its total assets. Market risks resulting from its security portfolio is only 2% of its total
risks. This is relatively small which indicates that security portfolios in Malaysian bank
consists of low risk weighted instruments.
Figure 51: Total Asset Decomposition, Malaysia
Source: Bankscope
Total
Securities
24%
Cash & Due
From Banks
10%
Others
6%
Loans
60%
Total Asset Decomposition